Canadian housing starts increased in 2015 thanks to Toronto’s condo market
By Lucas on Jan 11, 2016
The Canada Mortgage and Housing Corporation (CMHC) released its latest housing starts report, announcing that Canadian housing starts trended lower in December 2015, but total starts for the year increased.
Across Canada, the trend measure of housing starts was 203,502 units, down from 208,204 in November 2015. The trend is a six month moving average of seasonally adjusted annual rates (SAAR).
“A decrease in both the multiple and single starts segments drove the December trend lower,” says Bob Dugan, CMHC Chief Economist. “Starts increased in 2015 compared to 2014, largely driven by the condominium market in Toronto. Had the Toronto condominium starts remained stable in 2015, national starts would have declined on a year-over-year basis.”
The standalone monthly SAAR in December 2015 was 172,965 units, a significant decrease from 212,028 in the previous month. The SAAR of urban starts decreased by 19.1% to 159,007 units. Multiple urban starts fell 27% to 101,264 units, while single-detached starts held steady at 57,743.
The Prairies, Ontario, and Atlantic Canada saw decreases in housing starts, with British Columbia and Quebec being the only regions to see increases. The estimated amount of rural starts was 13,958 units.
The Canary District in Toronto
Housing starts in Toronto CMA
Dugan is accurate in pointing out that housing starts would have seen a decline if not for the high amount of condo starts in Toronto. The trend measure in Toronto CMA for December 2015 was 44,881 units, which is a slight drop compared to November 2015. The standalone monthly SAAR was 24,852 units, a pretty large decrease compared to the 59,011 starts in November.
“While Toronto saw housing starts decrease in December, overall actual starts for the year increased by 46% compared to 2014,” says Andrew Scott, CMHC Senior Market Analyst for the GTA. “Not only did 2015 see apartment construction increase by 76% in the region, it also saw single-detached and row home starts increase. Improving labour market conditions and lower mortgage rates ramped up housing demand in 2015.”
Overall for the region, Brampton had the most housing starts in December, followed by the City of Toronto seeing many condo and single-detached starts. Vaughan had the third most starts, most of which were singles.
Will the demand for new housing stay strong through 2016?
